• Beware Of Multiple Unfair Dismissal Claims
  • August 2, 2012
  • Law Firm: Norton Rose Canada LLP - Montreal Office
  • Employers who disposed of an unfair dismissal claim and who believe that they have seen the end of a certain employee, may be in for a big surprise when it receives notification of a second dispute.

    Ordinarily, the principle of res judicata will prevent the duplication of a claim if a matter deals with the same parties and the same issues of fact or law has previously been determined in an earlier judgment or decision. However, this scenario must be distinguished from a case where the same facts have given rise to two different causes of action. In the context of labour law, employers must be alive to the fact that an employee who decides to pursue a claim for an unfair dismissal in terms of the Labour Relations Act, 1995 (LRA) will not be prevented from also alleging unfair discrimination in terms of the Employment Equity Act, 1998 (EEA). This is because these two claims are based on two separate causes of action although it may arise from the same facts. It is therefore possible that when an employee’s contract of service is terminated, an employer may be faced with more than one claim.

    This issue was recently considered by the Labour Appeal court in Gauteng Shared Services Centre v Ditsamai (2012) 33 ILJ 348 (LAC). An employee applied for a senior position as a forensic auditor and was placed on a fixed term (six months) contract as a temporary junior forensic auditor. The employer thereafter appointed a white male and Indian female to permanent senior posts. The employee lodged a grievance alleging unsatisfactory treatment, bias and victimisation. He was subsequently dismissed..

    The employee argued that he had been dismissed because he lodged a grievance. He referred an alleged unfair dismissal dispute to the bargaining council where the arbitrator held that his dismissal was unfair. The employee was awarded 18 weeks compensation.

    Shortly thereafter, the employee also referred a dispute in terms of section 10 of the EEA. He alleged that he had been unfairly discriminated against on the basis of colour and race when his employer failed to appoint him to a permanent position but preferred white and Indian applicants over himself, a black male. The employer argued that the employee had previously received relief from the bargaining council for his unfair dismissal in the form of compensation and accordingly should be barred from instituting a further claim in terms of the EEA for additional relief. The Labour Appeal Court rejected this argument because the unfair discrimination dispute did not raise the same question of law.

    This principle is not entirely new in our law. In Ntsabo v Real Security (2003) ILJ 2341 (LC) the employee concurrently instituted action against her employer for constructive dismissal in terms of the LRA and further, for sexual harassment in terms of the EEA. With regard to the constructively dismissed dispute, the employee received the maximum amount of compensation. The Labour Court further held that the employee had been sexually harassed by her superior and found that the company’s failure to attend to the employee's complaint of sexual harassment amounted to discrimination in terms of the EEA. The court awarded the employee compensation and damages in terms of the EEA, in addition to the compensation she had already received for being constructively dismissed.

    It is important that employers understand the difference between an unfair dismissal dispute and a discrimination claim. In the first instance, an employee has 6 months after an alleged unfair act of discrimination to refer a dispute in terms of the EEA. An unfair dismissal dispute must be referred to the CCMA within 30 days from the date of the dismissal. Secondly, the remedies available under each Act varies. There is no cap on the amount of compensation that may be awarded in an unfair discrimination claim. The labour court has a discretion to order compensation that it deems appropriate. In contrast, the LRA provides for a maximum of either 12 months or 24 months remuneration as at the date of dismissal for an unfair dismissal or an automatically unfair dismissal claim respectively.

    In light of the above, employers must ensure that if they do settle an unfair dismissal dispute with an employee, the wording of any settlement agreement is wide enough to also resolve other claims. If not, the employee will be able to institute an unfair discrimination claim within the longer 6 month time period - just when the employer thought that it had seen the end of the matter